WARRANT AGENT AGREEMENT
Exhibit 4.1
WARRANT
AGENT AGREEMENT (this “Warrant Agreement”) dated
as of _________, 2021 (the “Issuance Date”) between
Novusterra Inc., a Florida corporation (the “Company”), and
[__________] (the “Warrant
Agent”).
2.2.9 For
purposes of clarity, if there is a conflict between the express
terms of this Warrant Agreement and the Warrant certificate in the
form of Annex B
hereto with respect to terms of the Warrants, the terms of the
Warrant certificate shall govern and control.
3.2 Duration
of Warrants. Warrants may be exercised only during the
period (“Exercise
Period”) commencing on the Issuance Date and
terminating at 11:59 P.M., New York City time (the “close of
business”) on _________, 2026 (“Expiration Date”). Each
Warrant not exercised on or before the Expiration Date shall become
void, and all rights thereunder and all rights in respect thereof
under this Warrant Agreement shall cease at the close of business
on the Expiration Date.
(a) Exercise
of the purchase rights represented by a Warrant may be made, in
whole or in part, at any time or times during the Exercise Period
by delivery to the Warrant Agent (with a copy to the Company) of
the Notice of Exercise in the form attached as Exhibit A to the
Definitive Certificate attached hereto as Annex B (the
“Notice of
Exercise”). Within the earlier of (i) two
(2) Trading Days and (ii) the number of Trading Days
comprising the Standard Settlement Period following the date the
Holder delivers the Notice of Exercise as aforesaid, the Holder
shall deliver the aggregate Exercise Price for the shares specified
in the applicable Notice of Exercise by wire transfer or
cashier’s check drawn on a United States bank unless the
cashless exercise procedure specified in Section 3.3.6 below
is specified in the applicable Notice of Exercise. No ink-original
Notice of Exercise shall be required, nor shall any medallion
guarantee (or other type of guarantee or notarization) of any
Notice of Exercise form be required. Notwithstanding anything
herein to the contrary, the Holder shall surrender such Warrant to
the Warrant Agent for cancellation within three (3) Trading
Days of the date the Notice of Exercise is delivered to the Warrant
Agent. Partial exercises of a Warrant resulting in purchases of a
portion of the total number of Warrant Shares available thereunder
shall have the effect of lowering the outstanding number of Warrant
Shares purchasable hereunder in an amount equal to the applicable
number of Warrant Shares purchased. The Holder and the Warrant
Agent shall maintain records showing the number of Warrant Shares
purchased and the date of such purchases. The Warrant Agent shall
deliver any objection to any Notice of Exercise within one
(1) Business Day of receipt of such notice. The Holder and any assignee, by acceptance of a
Warrant, acknowledge and agree that, by reason of the provisions of
this paragraph, following the purchase of a portion of the Warrant
Shares under a Warrant, the number of Warrant Shares available for
purchase thereunder at any given time may be less than the amount
stated on the face thereof.
(b) Notwithstanding
the foregoing in this Section 3.3.1, a holder whose interest
in a Warrant is a beneficial interest in
certificate(s) representing such Warrant held in registered
form through DTC (or another established clearing corporation
performing similar functions), shall effect exercises made pursuant
to this Section 3.3.1 by delivering to DTC (or such other
clearing corporation, as applicable) the appropriate instruction
form for exercise, complying with the procedures to effect exercise
that are required by DTC (or such other clearing corporation, as
applicable), subject to a holder’s right to elect to receive
a Definitive Warrant pursuant to the terms of this Warrant
Agreement, in which case this sentence shall not apply. Upon giving
irrevocable instructions to its Participant to exercise Warrants,
solely for purposes of Regulation SHO, the holder whose interest in
the Warrant is a beneficial interest shall be deemed to have
exercised such Warrant, regardless of when the applicable Warrant
Shares are delivered to such holder.
(a) The
Warrant Agent shall, on the Trading Day following the date it
receives a Notice of Exercise, advise the Company and the transfer
agent and registrar for the Company’s Common Stock (if the
Warrant Agent is not the transfer agent), in respect of
(i) the number of Warrant Shares indicated on the Notice of
Exercise as issuable upon such exercise with respect to such
exercised Warrants, (ii) the instructions of the Holder or
Participant, as the case may be, provided to the Warrant Agent with
respect to the delivery of the Warrant Shares and the number of
Warrants that remain outstanding after such exercise and
(iii) such other information as the Company or such transfer
agent and registrar shall reasonably request.
(b) The
Company shall cause the Warrant Shares purchased hereunder to be
transmitted by the Transfer Agent to the Holder by crediting the
account of the Holder’s or its designee’s balance
account with DTC through its Deposit or Withdrawal at Custodian
system (“DWAC”) if the Company is
then a participant in such system and either (A) there is an
effective registration statement permitting the issuance of the
Warrant Shares to or resale of the Warrant Shares by the Holder or
(B) the Warrant is being exercised via cashless exercise, and
otherwise by physical delivery of a certificate, registered in the
Company’s share register in the name of the Holder or its
designee, for the number of Warrant Shares to which the Holder is
entitled pursuant to such exercise to the address specified by the
Holder in the Notice of Exercise by the date that is the earlier of
(i) two (2) Trading Days and (ii) the number of
Trading Days comprising the Standard Settlement Period after the
delivery to the Company of the Notice of Exercise (such date, the
“Warrant Share
Delivery Date”). Upon delivery of the Notice of
Exercise (or, if earlier, upon giving irrevocable instructions to
its Participant to exercise Warrants, solely for purposes of
Regulation SHO), the Holder shall be deemed for all corporate
purposes to have become the holder of record of the Warrant Shares
with respect to which a Warrant has been exercised, irrespective of
the date of delivery of the Warrant Shares, provided that payment
of the aggregate Exercise Price (other than in the case of a
cashless exercise) is received within the earlier of (i) two
(2) Trading Days of and (ii) the number of Trading Days
comprising the Standard Settlement Period following delivery of the
Notice of Exercise. If the Company fails for any reason to deliver
to the Holder the Warrant Shares subject to a Notice of Exercise by
the Warrant Share Delivery Date, the Company shall pay to the
Holder, in cash, as liquidated damages and not as a penalty, for
each $1,000 of Warrant Shares subject to such exercise (based on
the VWAP of the Common Stock on the date of the applicable Notice
of Exercise), $10 per Trading Day (increasing to $20 per Trading
Day on the fifth Trading Day after such liquidated damages begin to
accrue) for each Trading Day after such Warrant Share Delivery Date
until such Warrant Shares are delivered or Holder rescinds such
exercise. The Company agrees to maintain a transfer agent that is a
participant in the FAST program so long as the Warrants remain
outstanding and exercisable. As used herein, “Standard
Settlement Period” means the standard settlement period,
expressed in a number of Trading Days, on the Company’s
primary Trading Market with respect to the Common Stock as in
effect on the date of delivery of the Notice of Exercise.
Notwithstanding the foregoing, with respect to any Notice(s) of
Exercise delivered on or prior to 12:00 p.m. (New York City time)
on the Issuance Date, which may be delivered at any time after the
time of execution of the Underwriting Agreement, the Company agrees
to deliver the Warrant Shares subject to such notice(s) by 4:00
p.m. (New York City time) on the Issuance Date and the Issuance
Date shall be the Warrant Share Delivery Date for purposes
hereunder, provided that payment of the aggregate Exercise Price
(other than in the case of a cashless exercise) is received by such
Warrant Share Delivery Date.
(i) The
Company shall use its reasonable best efforts to maintain the
effectiveness of the Registration Statement and the current status
of the prospectus included therein or to file and maintain the
effectiveness of another registration statement and another current
prospectus covering the Warrants and the Warrant Shares at any time
that the Warrants are exercisable. The Company shall provide to the
Warrant Agent and each Holder prompt written notice of any time
that the Company is unable to deliver the Warrant Shares via DTC
transfer or otherwise without restrictive legend because
(A) the Commission has issued a stop order with respect to the
Registration Statement, (B) the Commission otherwise has
suspended or withdrawn the effectiveness of the Registration
Statement, either temporarily or permanently, (C) the Company
has suspended or withdrawn the effectiveness of the Registration
Statement, either temporarily or permanently, (D) the
prospectus contained in the Registration Statement is not available
for the issuance of the Warrant Shares to the Holder or
(E) otherwise (each a “Restrictive Legend
Event”). To the extent that the Warrants cannot be
exercised as a result of a Restrictive Legend Event or a
Restrictive Legend Event occurs after a Holder has exercised
Warrants in accordance with the terms of the Warrants but prior to
the delivery of the Warrant Shares, the Company shall, at the
election of the Holder, which shall be given within five
(5) days of receipt of such notice of the Restrictive Legend
Event, either (A) rescind the previously submitted Notice of
Exercise and the Company shall return all consideration paid by
registered holder for such shares upon such rescission or
(B) treat the attempted exercise as a cashless exercise as
described in paragraph (ii) below and refund the cash portion
of the exercise price to the Holder.
(ii) If
a Restrictive Legend Event has occurred and is continuing, the
Warrants may also be exercisable on a cashless basis.
Notwithstanding anything herein to the contrary, the Company shall
not be required to make any cash payments or net cash settlement to
the Holder in lieu of delivery of the Warrant Shares. Upon a
“cashless exercise”, the Holder shall be entitled to
receive the number of Warrant Shares equal to the quotient (if such
quotient would be a positive number) obtained by dividing (A-B)
(X) by (A), where:
(A)
=
As applicable:
(i) the VWAP on the Trading Day immediately preceding the date
of the applicable Notice of Exercise if such Notice of Exercise is
(1) both executed and delivered pursuant to
Section 3.3.1(a) hereof on a day that is not a Trading
Day or (2) both executed and delivered pursuant to
Section 3.3.1(a) hereof on a Trading Day prior to the
opening of “regular trading hours” (as defined in
Rule 600(b)(68) of Regulation NMS promulgated under the
federal securities laws) on such Trading Day, (ii) at the
option of the Holder, either (y) the VWAP on the Trading Day
immediately preceding the date of the applicable Notice of Exercise
or (z) the Bid Price of the Common Stock on the principal
Trading Market as reported by Bloomberg L.P. as of the time of the
Holder’s execution of the applicable Notice of Exercise if
such Notice of Exercise is executed during “regular trading
hours” on a Trading Day and is delivered within two
(2) hours thereafter (including until two (2) hours after
the close of “regular trading hours” on a Trading Day)
pursuant to Section 3.3.1(a) hereof, or (iii) the
VWAP on the date of the applicable Notice of Exercise if the date
of such Notice of Exercise is a Trading Day and such Notice of
Exercise is both executed and delivered pursuant to
Section 3.3.1(a) hereof after the close of “regular
trading hours” on such Trading Day.
(B)
=
The Exercise Price
then in effect for the applicable Warrant Shares at the time of
such exercise.
(X)
=
the number of
Warrant Shares that would be issuable upon exercise of the Warrant
in accordance with the terms of the Warrant if such exercise were
by means of a cash exercise rather than a cashless
exercise.
If the
Warrant Shares are issued in such a cashless exercise, the Company
acknowledges and agrees that, in accordance with
Section 3(a)(9) of the Securities Act, the Warrant Shares
shall take on the registered characteristics of the Warrants being
exercised and the holding period of the Warrants being exercised
may be tacked to the holding period of the Warrant Shares, and the
Company agrees not to take any position contrary thereto. Upon
receipt of a Notice of Exercise for a cashless exercise, the
Warrant Agent will promptly deliver a copy of the Notice of
Exercise to the Company to confirm the number of Warrant Shares
issuable in connection with the cashless exercise. The Company
shall calculate and transmit to the Warrant Agent in a written
notice, and the Warrant Agent shall have no duty, responsibility or
obligation under this section to calculate, the number of Warrant
Shares issuable in connection with any cashless exercise. The
Warrant Agent shall be entitled to rely conclusively on any such
written notice provided by the Company, and the Warrant Agent shall
not be liable for any action taken, suffered or omitted to be taken
by it in accordance with such written instructions or pursuant to
this Warrant Agreement. Notwithstanding anything herein to
the contrary, on the Expiration Date, this Warrant shall be
automatically exercised via cashless exercise pursuant to this
Section 3.3.6(ii).
(i) So
long as any Warrants remains outstanding, the Company shall at all
times keep reserved for issuance under the Warrants a number of
shares of Common Stock at least equal to 100% of the maximum number
of shares of Common Stock as shall be necessary to satisfy the
Company’s obligation to issue shares of Common Stock under
the Warrants then outstanding (without regard to any limitations on
exercise) (the “Required Reserve
Amount”); provided that at no time shall the number of
shares of Common Stock reserved pursuant to this
Section 3.3.10(i) be reduced other than proportionally in
connection with any exercise or redemption of Warrants or such
other event covered by Section 4 below. The Required Reserve
Amount (including, without limitation, each increase in the number
of shares so reserved) shall be allocated pro rata among the
Holders of the Warrants based on number of shares of Common Stock
issuable upon exercise of Warrants held by each Holder on the
Issuance Date (without regard to any limitations on exercise) or
increase in the number of reserved shares, as the case may be (the
“Authorized Share
Allocation”). In the event that a Holder shall sell or
otherwise transfer any of such Holder’s Warrants, each
transferee shall be allocated a pro rata portion of such
Holder’s Authorized Share Allocation. Any shares of Common
Stock reserved and allocated to any person which ceases to hold any
Warrants shall be allocated to the remaining Holders of Registered
Warrants, pro rata based on the number of shares of Common Stock
issuable upon exercise of the Warrants then held by such Holders
(without regard to any limitations on exercise).
(ii) If,
notwithstanding Section 3.3.10(i) above, and not in
limitation thereof, at any time while any of the Warrants remain
outstanding, the Company does not have a sufficient number of
authorized and unreserved shares of Common Stock to satisfy its
obligation to reserve the Required Reserve Amount (an
“Authorized Share
Failure”), then the Company shall immediately take all
action necessary to increase the Company’s authorized shares
of Common Stock to an amount sufficient to allow the Company to
reserve the Required Reserve Amount for all the Warrants then
outstanding. Without limiting the generality of the foregoing
sentence, as soon as practicable after the date of the occurrence
of an Authorized Share Failure, but in no event later than sixty
(60) days after the occurrence of such Authorized Share Failure,
the Company shall hold a meeting of its shareholders for the
approval of an increase in the number of authorized shares of
Common Stock. In connection with such meeting, the Company shall
provide each shareholder with a proxy statement and shall use its
best efforts to solicit its shareholders’ approval of such
increase in authorized Common Stock and to cause its board of
directors to recommend to the shareholders that they approve such
proposal. In the event that the Company is prohibited from issuing
shares of Common Stock upon an exercise of a Warrant due to the
failure by the Company to have sufficient shares of Common Stock
available out of the authorized but unissued Common Stock (such
unavailable number of shares of Common Stock, the
“Authorization
Failure Shares”), in lieu of delivering such
Authorization Failure Shares to a Holder, the Company shall pay
cash in exchange for the cancellation of such portion of the
applicable Warrant exercisable into such Authorization Failure
Shares at a price equal to the sum of (i) the product of
(x) such number of Authorization Failure Shares and
(y) the greatest Closing Sale Price of the Common Stock on any
Trading Day during the period commencing on the date the Holder
delivers the applicable Exercise Notice with respect to such
Authorization Failure Shares to the Company and ending on the date
of such issuance and payment under this Section 1(f); and
(ii) to the extent the Holder purchases (in an open market
transaction or otherwise) shares of Common Stock to deliver in
satisfaction of a sale by the Holder of Authorization Failure
Shares, any Buy-In Payment Amount, brokerage commissions and other
out-of-pocket expenses, if any, of the Holder incurred in
connection therewith.
Notwithstanding the
foregoing and the provisions of Section 4.3, at the request of a
Holder delivered at any time commencing on the earliest to occur of
(x) the public disclosure of any Fundamental Transaction,
(y) the consummation of any Fundamental Transaction and
(z) the Holder first becoming aware of any Fundamental
Transaction through the date that is thirty (30) days after the
public disclosure of the consummation of such Fundamental
Transaction by the Company pursuant to a Current Report on
Form 8-K filed with the United States Securities and Exchange
Commission, the Company or the Successor Entity (as the case may
be) shall purchase the Warrant from the Holder on the date of such
request by paying to the Holder cash in an amount equal to the
Black Scholes Value (as defined below). Payment of such amounts
shall be made by the Company (or at the Company’s direction)
to the Holder on or prior to the later of (x) the second (2nd)
Trading Day after the date of such request and (y) the date of
consummation of such Fundamental Transaction; provided, however, if the Fundamental
Transaction is not within the Company’s control, including
not approved by the Company’s board of directors or the
consideration is not in all shares of the Successor Entity, the
Holders shall only be entitled to receive from the Company or any
Successor Entity, as of the date of consummation of such
Fundamental Transaction, the same type or form of consideration
(and in the same proportion), at the Black Scholes Value of the
unexercised portion of the Warrants, that is being offered and paid
to the holders of shares of Common Stock of the Company in
connection with the Fundamental Transaction, whether that
consideration be in the form of cash, shares or any combination
thereof, or whether the holders of Common Stock are given the
choice to receive from among alternative forms of consideration in
connection with the Fundamental Transaction. “Black Scholes Value”
means the value of the unexercised portion of a Warrant remaining
on the date of the Holder’s request, which value is
calculated using the greater of the Black Scholes Option Pricing
Model obtained from the “OV” function on Bloomberg, as
a put option or a call option, utilizing (i) an underlying price
per share equal to, at the Holder’s election, either, (1) the
highest or lowest (at the Holder’s election) Closing Sale
Price of the Common Stock during the period beginning on the
Trading Day immediately preceding the announcement of the
applicable Fundamental Transaction (or the consummation of the
applicable Fundamental Transaction, if earlier) and ending on the
Trading Day of the Holder’s request or (2) the sum of the
price per share being offered in cash in the applicable Fundamental
Transaction (if any) plus the value of the non-cash consideration
being offered in the applicable Fundamental Transaction (if any),
(ii) (1) if calculating as a call option, a strike price equal to
the Exercise Price in effect on the date of the Holder’s
request, or (2) if calculating as a put option, a strike price
equal to $[ ] (as adjusted for share splits, share dividends, share
combinations, recapitalizations or other similar events), (iii) a
risk-free interest rate corresponding to the U.S. Treasury rate for
a period equal to the greater of (1) the remaining term of the
Warrant as of the date of consummation of the applicable
Fundamental Transaction or as of the date of the Holder’s
request if such request is prior to the date of the consummation of
the applicable Fundamental Transaction, (iv) a zero cost of borrow,
(v) an expected volatility equal to the greater of 100% and the 100
day volatility obtained from the “HVT” function on
Bloomberg (determined utilizing a 365 day annualization factor) as
of the Trading Day immediately following the earliest to occur of
(A) the public disclosure of the applicable Fundamental
Transaction, (B) the consummation of the applicable Fundamental
Transaction and (C) the date on which the Holder first became aware
of the applicable Fundamental Transaction, and (vi) a remaining
option time equal to the time between the date of the public
announcement of the applicable Fundamental Transaction and the
Expiration Date.
The
Company shall instruct the Warrant Agent in writing to mail by
first class mail, postage prepaid, to each Holder, written notice
of the execution of any such amendment, supplement or agreement
with the Successor Entity. Any supplemented or amended agreement
entered into by the successor corporation or transferee shall
provide for adjustments, which shall be as nearly equivalent as may
be practicable to the adjustments provided for in this
Section 4.3. The Warrant Agent shall have no duty,
responsibility or obligation to determine the correctness of any
provisions contained in such agreement or such notice, including
but not limited to any provisions relating either to the kind or
amount of securities or other property receivable upon exercise of
warrants or with respect to the method employed and provided
therein for any adjustments, and shall be entitled to rely
conclusively for all purposes upon the provisions contained in any
such agreement. The provisions of this Section 4.3 shall
similarly apply to successive reclassifications, changes,
consolidations, mergers, sales and conveyances of the kind
described above.
7.1 Any
instructions given to the Warrant Agent orally, as permitted by any
provision of this Warrant Agreement, shall be confirmed in writing
by the Company as soon as practicable. The Warrant Agent shall not
be liable or responsible and shall be fully authorized and
protected for acting, or failing to act, in accordance with any
oral instructions which do not conform with the written
confirmation received in accordance with this
Section 7.1.
7.2 (a) Whether
or not any Warrants are exercised, for the Warrant Agent’s
services as agent for the Company hereunder, the Company shall pay
to the Warrant Agent such fees as may be separately agreed between
the Company and Warrant Agent and the Warrant Agent’s out of
pocket expenses in connection with this Warrant Agreement,
including, without limitation, the reasonable fees and expenses of
the Warrant Agent’s counsel. While the Warrant Agent
endeavors to maintain out-of-pocket charges (both internal and
external) at competitive rates, these charges may not reflect
actual out-of-pocket costs, and may include handling charges to
cover internal processing and use of the Warrant Agent’s
billing systems.
(b) All
amounts owed by the Company to the Warrant Agent under this Warrant
Agreement are due within 30 days of the Company’s receipt of
an invoice.
(c) No
provision of this Warrant Agreement shall require Warrant Agent to
expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties under this
Warrant Agreement or in the exercise of its rights.
7.3 As
agent for the Company hereunder, the Warrant Agent:
(a) shall
have no duties or obligations other than those specifically set
forth herein or as may subsequently be agreed to in writing by the
Warrant Agent and the Company;
(b) shall
be regarded as making no representations and having no
responsibilities as to the validity, sufficiency, value, or
genuineness of the Warrants or any Warrant Shares;
(c) shall
not be obligated to take any legal action hereunder; if, however,
the Warrant Agent determines to take any legal action hereunder,
and where the taking of such action might, in its judgment, subject
or expose it to any expense or liability it shall not be required
to act unless it has been furnished with an indemnity reasonably
satisfactory to it;
(d) may
rely on and shall be fully authorized and protected in acting or
failing to act upon any certificate, instrument, opinion, notice,
letter, telegram, telex, facsimile transmission or other document
or security delivered to the Warrant Agent and believed by it to be
genuine and to have been signed by the proper party or
parties;
(e) shall
not be liable or responsible for any recital or statement contained
in the Registration Statement or any other documents relating
thereto;
(f) shall
not be liable or responsible for any failure on the part of the
Company to comply with any of its covenants and obligations
relating to the Warrants, including without limitation obligations
under applicable securities laws;
(g) may
rely on and shall be fully authorized and protected in acting or
failing to act upon the written, telephonic or oral instructions
with respect to any matter relating to its duties as Warrant Agent
covered by this Warrant Agreement (or supplementing or qualifying
any such actions) of officers of the Company, and is hereby
authorized and directed to accept instructions with respect to the
performance of its duties hereunder from the Company or counsel to
the Company, and may apply to the Company, for advice or
instructions in connection with the Warrant Agent’s duties
hereunder, and the Warrant Agent shall not be liable for any delay
in acting while waiting for those instructions; any applications by
the Warrant Agent for written instructions from the Company may, at
the option of the Warrant Agent, set forth in writing any action
proposed to be taken or omitted by the Warrant Agent under this
Warrant Agreement and the date on or after which such action shall
be taken or such omission shall be effective; the Warrant Agent
shall not be liable for any action taken by, or omission of, the
Warrant Agent in accordance with a proposal included in such
application on or after the date specified in such application
(which date shall not be less than five business days after the
date such application is sent to the Company, unless the Company
shall have consented in writing to any earlier date) unless prior
to taking any such action, the Warrant Agent shall have received
written instructions in response to such application specifying the
action to be taken or omitted;
(h) may
consult with counsel satisfactory to the Warrant Agent, including
its in-house counsel, and the advice of such counsel shall be full
and complete authorization and protection in respect of any action
taken, suffered, or omitted by it hereunder in good faith and in
accordance with the advice of such counsel;
(i) may
perform any of its duties hereunder either directly or by or
through nominees, correspondents, designees, or subagents, and it
shall not be liable or responsible for any misconduct or negligence
on the part of any nominee, correspondent, designee, or subagent
appointed with reasonable care by it in connection with this
Warrant Agreement;
(j) is
not authorized, and shall have no obligation, to pay any brokers,
dealers, or soliciting fees to any person; and
(k) shall
not be required hereunder to comply with the laws or regulations of
any country other than the United States of America or any
political subdivision thereof.
7.4 (a) In
the absence of gross negligence or willful or illegal misconduct on
its part, the Warrant Agent shall not be liable for any action
taken, suffered, or omitted by it or for any error of judgment made
by it in the performance of its duties under this Warrant
Agreement. Anything in this Warrant Agreement to the contrary
notwithstanding, in no event shall Warrant Agent be liable for
special, indirect, incidental, consequential or punitive losses or
damages of any kind whatsoever (including but not limited to lost
profits), even if the Warrant Agent has been advised of the
possibility of such losses or damages and regardless of the form of
action. Any liability of the Warrant Agent will be limited in the
aggregate to the amount of fees paid by the Company hereunder. The
Warrant Agent shall not be liable for any failures, delays or
losses, arising directly or indirectly out of conditions beyond its
reasonable control including, but not limited to, acts of
government, exchange or market ruling, suspension of trading, work
stoppages or labor disputes, fires, civil disobedience, riots,
rebellions, storms, electrical or mechanical failure, computer
hardware or software failure, communications facilities failures
including telephone failure, war, terrorism, insurrection,
earthquakes, floods, acts of God or similar occurrences, provided
that such events shall not affect in any way the Company’s
obligations to the Holders under the Warrant
Certificates.
(b) In
the event any question or dispute arises with respect to the proper
interpretation of the Warrants or the Warrant Agent’s duties
under this Warrant Agreement or the rights of the Company or of any
Holder, the Warrant Agent shall not be required to act and shall
not be held liable or responsible for its refusal to act until the
question or dispute has been judicially settled (and, if
appropriate, it may file a suit in interpleader or for a
declaratory judgment for such purpose) by final judgment rendered
by a court of competent jurisdiction, binding on all persons
interested in the matter which is no longer subject to review or
appeal, or settled by a written document in form and substance
satisfactory to Warrant Agent and executed by the Company and each
such Holder. In addition, the Warrant Agent may require for such
purpose, but shall not be obligated to require, the execution of
such written settlement by all the Holders and all other persons
that may have an interest in the settlement.
7.5 The
Company covenants to indemnify the Warrant Agent and hold it
harmless from and against any loss, liability, claim or expense
(“Loss”) arising out of or
in connection with the Warrant Agent’s duties under this
Warrant Agreement, including the costs and expenses of defending
itself against any Loss, unless such Loss shall have been
determined by a court of competent jurisdiction to be a result of
the Warrant Agent’s gross negligence or willful
misconduct.
7.6 Unless
terminated earlier by the parties hereto, this Warrant Agreement
shall terminate 90 days after the earlier of the Expiration Date
and the date on which no Warrants remain outstanding (the
“Termination
Date”). On the business day following the Termination
Date, the Warrant Agent shall deliver to the Company any
entitlements, if any, held by the Warrant Agent under this Warrant
Agreement. The Warrant Agent’s right to be reimbursed for
fees, charges and out-of-pocket expenses as provided in this
Section 7 shall survive the termination of this Warrant
Agreement.
7.7 If
any provision of this Warrant Agreement shall be held illegal,
invalid, or unenforceable by any court, this Warrant Agreement
shall be construed and enforced as if such provision had not been
contained herein and shall be deemed an agreement among the parties
to it to the full extent permitted by applicable law.
7.8 The
Company represents and warrants that (a) it is duly
incorporated and validly existing under the laws of its
jurisdiction of incorporation, (b) the offer and sale of the
Warrants and the execution, delivery and performance of all
transactions contemplated thereby (including this Warrant
Agreement) have been duly authorized by all necessary corporate
action and will not result in a breach of or constitute a default
under the articles of association, bylaws or any similar document
of the Company or any indenture, agreement or instrument to which
it is a party or is bound, (c) this Warrant Agreement has been
duly executed and delivered by the Company and constitutes the
legal, valid, binding and enforceable obligation of the Company,
(d) the Warrants will comply in all material respects with all
applicable requirements of law and (e) to the best of its
knowledge, there is no litigation pending or threatened as of the
date hereof in connection with the offering of the
Warrants.
7.9 In
the event of inconsistency between this Warrant Agreement and the
descriptions in the Registration Statement, as they may from time
to time be amended, the terms of this Warrant Agreement shall
control.
7.10 Any
notice, statement or demand authorized by this Warrant Agreement to
be given or made by the Warrant Agent or by the holder of any
Warrant to or on the Company, including, without limitation, the
copy of any Notice of Exercise, shall be in writing and delivered
by e-mail, hand or sent by a nationally recognized overnight
courier service, addressed (until another address is filed in
writing by the Company with the Warrant Agent) as set forth below
and if to any holder any notice, statement or demand shall be given
to the last address set forth for such holder (if any) in the
Warrant Register:
000 XX
00xx
Xxxxxx, Xxxxx 000
Xxxxx,
XX 00000
Attn:
Chief Executive Officer
Phone:
(000) 000-0000
Email:
xxxxx@xxxxxxxxx.xxx
with a
copy (which shall not constitute notice) to:
Xxxxxxxx X.
Xxxx
Law
Office of Xxxxxxxx X. Xxxx, P.A.
0000
Xxxxxxxx Xxxxxxxxx
Xxxxxxxx, XX
00000
Phone:
(000) 000-0000
Email:
xxx@xxxxxxxxxx.xxx
Any
notice, statement or demand authorized by this Warrant Agreement to
be given or made by the holder of any Warrant or by the Company to
or on the Warrant Agent, including, without limitation, any Notice
of Exercise, shall be in writing and delivered by facsimile, hand
or sent by a nationally recognized overnight courier service,
addressed (until another address is filed in writing by the Warrant
Agent with the Company), as follows:
[__________]
[__________]
[__________]
Fax No:
[ ]
Email:
[ ]
Any
notice or other communication or deliveries hereunder shall be
deemed given and effective on the earliest of (i) the time of
transmission, if such notice or communication is delivered via
facsimile at the facsimile number or e-mail at the e-mail address
set forth above in this Section 7.11 prior to 5:30
p.m. (New York City time) on any date, (ii) the next
Trading Day after the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number or
e-mail at the e-mail address set forth in this Section on a
day that is not a Trading Day or later than 5:30 p.m. (New
York City time) on any Trading Day, (iii) the second Trading
Day following the date of mailing, if sent by U.S. nationally
recognized overnight courier service, or (iv) upon actual
receipt by the party to whom such notice is required to be given.
Notwithstanding any other provision of this Warrant Agreement,
where this Warrant Agreement provides for notice of any event to
the Holder, if a Warrant is held in global form by DTC (or any
successor depositary), such notice shall be sufficiently given if
given to DTC (or any successor depositary) pursuant to the
procedures of DTC (or such successor depositary).
7.11 (a) This
Warrant Agreement shall be governed by and construed in accordance
with the laws of the State of New York. All actions and proceedings
relating to or arising from, directly or indirectly, this Warrant
Agreement may be litigated in courts located within the Borough of
Manhattan in the City and State of New York. The Company hereby
submits to the personal jurisdiction of such courts and consents
that any service of process may be made by certified or registered
mail, return receipt requested, directed to the Company at its
address last specified for notices hereunder.
(b) This
Warrant Agreement shall inure to the benefit of and be binding upon
the successors and assigns of the parties hereto. This Warrant
Agreement may not be assigned, or otherwise transferred, in whole
or in part, by either party without the prior written consent of
the other party, which the other party will not unreasonably
withhold, condition or delay; except that (i) consent is not
required for an assignment or delegation of duties by Warrant Agent
to any Affiliate of Warrant Agent and (ii) any reorganization,
merger, consolidation, sale of assets or other form of business
combination by Warrant Agent or the Company shall not be deemed to
constitute an assignment of this Warrant Agreement.
(c) No
provision of this Warrant Agreement may be amended, modified or
waived, except in a written document signed by both parties. The
Company and the Warrant Agent may amend or supplement this Warrant
Agreement without the consent of any Holder for the purpose of
curing any ambiguity, or curing, correcting or supplementing any
defective provision contained herein or adding or changing any
other provisions with respect to matters or questions arising under
this Warrant Agreement as the parties may deem necessary or
desirable and that the parties determine, in good faith, shall not
adversely affect the interest of the Holders, provided, however,
that no modification of the terms upon which the Warrants are
exercisable or the rights of the Holders to receive payments in
cash from the Company or to require a Holder of Warrants to deliver
any ink-original Notice of Exercise or any medallion guarantee (or
other type of guarantee or notarization) of a Notice of Exercise or
to the beneficial ownership limitation.
7.13.1 Appointment
of Successor Warrant Agent. The Warrant Agent, or any
successor to it hereafter appointed, may resign its duties and be
discharged from all further duties and liabilities hereunder after
giving thirty (30) days’ notice in writing to the Company, or
such shorter period of time agreed to by the Company. The Company
may terminate the services of the Warrant Agent, or any successor
Warrant Agent, after giving thirty (30) days’ notice in
writing to the Warrant Agent or successor Warrant Agent, or such
shorter period of time as agreed. If the office of the Warrant
Agent becomes vacant by resignation, termination or incapacity to
act or otherwise, the Company shall appoint in writing a successor
Warrant Agent in place of the Warrant Agent. If the Company shall
fail to make such appointment within a period of 30 days after it
has been notified in writing of such resignation or incapacity by
the Warrant Agent, then the Warrant Agent or any Holder may apply
to any court of competent jurisdiction for the appointment of a
successor Warrant Agent at the Company’s cost. Pending
appointment of a successor to such Warrant Agent, either by the
Company or by such a court, the duties of the Warrant Agent shall
be carried out by the Company. Any successor Warrant Agent (but not
including the initial Warrant Agent), whether appointed by the
Company or by such court, shall be a person organized and existing
under the laws of any state of the United States of America, in
good standing, and authorized under such laws to exercise corporate
trust powers and subject to supervision or examination by federal
or state authority. After appointment, any successor Warrant Agent
shall be vested with all the authority, powers, rights, immunities,
duties, and obligations of its predecessor Warrant Agent with like
effect as if originally named as Warrant Agent hereunder, without
any further act or deed, and except for executing and delivering
documents as provided in the sentence that follows, the predecessor
Warrant Agent shall have no further duties, obligations,
responsibilities or liabilities hereunder, but shall be entitled to
all rights that survive the termination of this Warrant Agreement
and the resignation or removal of the Warrant Agent, including but
not limited to its right to indemnity hereunder. If for any reason
it becomes necessary or appropriate or at the request of the
Company, the predecessor Warrant Agent shall execute and deliver,
at the expense of the Company, an instrument transferring to such
successor Warrant Agent all the authority, powers, and rights of
such predecessor Warrant Agent hereunder; and upon request of any
successor Warrant Agent the Company shall make, execute,
acknowledge, and deliver any and all instruments in writing for
more fully and effectually vesting in and confirming to such
successor Warrant Agent all such authority, powers, rights,
immunities, duties, and obligations.
7.13.2 Notice
of Successor Warrant Agent. In the event a successor Warrant
Agent shall be appointed, the Company shall give notice thereof to
the predecessor Warrant Agent and the transfer agent for the Common
Stock not later than the effective date of any such
appointment.
7.13.3 Merger
or Consolidation of Warrant Agent. Any person into which the
Warrant Agent may be merged or converted or with which it may be
consolidated or any person resulting from any merger, conversion or
consolidation to which the Warrant Agent shall be a party or any
person succeeding to the shareowner services business of the
Warrant Agent or any successor Warrant Agent shall be the successor
Warrant Agent under this Warrant Agreement, without any further act
or deed.
(i) “Adjustment
Right” means any right granted with respect to any
securities issued in connection with, or with respect to, any
issuance, sale or delivery (or deemed issuance, sale or delivery in
accordance with Section 4) of Common Stock (other than rights
of the type described in Section 4.2 and 4.3 hereof) that
could result in a decrease in the net consideration received by the
Company in connection with, or with respect to, such securities
(including, without limitation, any cash settlement rights, cash
adjustment or other similar rights) but excluding anti-dilution and
other similar rights (including pursuant to Section 4.4 of
this Agreement).
(ii) “Affiliate”
means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed
under Rule 405 under the Securities Act.
(iii) “Closing
Sale Price” means, for any security as of any date,
the last closing trade price for such security on the Principal
Market, as reported by Bloomberg, or, if the Principal Market
begins to operate on an extended hours basis and does not designate
the closing trade price, then the last trade price of such security
prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or,
if the Principal Market is not the principal securities exchange or
trading market for such security, the last trade price of such
security on the principal securities exchange or trading market
where such security is listed or traded as reported by Bloomberg,
or if the foregoing does not apply, the last trade price of such
security in the over-the-counter market on the electronic bulletin
board for such security as reported by Bloomberg, or, if no last
trade price is reported for such security by Bloomberg, the average
of the ask prices of any market makers for such security as
reported in the “pink sheets” by OTC Markets Group Inc.
(formerly Pink Sheets LLC). If the Closing Sale Price cannot be
calculated for a security on a particular date on any of the
foregoing bases, the Closing Sale Price of such security on such
date shall be the fair market value as mutually determined by the
Company and the applicable Holder. All such determinations shall be
appropriately adjusted for any share dividend, share split, share
combination or other similar transaction during such
period.
(iv) “person”
shall mean any individual, firm, corporation, partnership, limited
liability company, joint venture, association, trust or other
entity, and shall include any successor (by merger or otherwise)
thereof or thereto.
(v) “Principal
Market” means the [______].
(vi) “Trading
Day” means any day on which the Common Stock is traded
on the Trading Market, or, if the Trading Market is not the
principal trading market for the Common Stock, then on the
principal securities exchange or securities market in the United
States on which the Common Stock is then traded, provided that
“Trading Day” shall not include any day on which the
Common Stock is scheduled to trade on such exchange or market for
less than 4.5 hours or any day that the Common Stock is suspended
from trading during the final hour of trading on such exchange or
market (or if such exchange or market does not designate in advance
the closing time of trading on such exchange or market, then during
the hour ending at 4:00 P.M., New York City time)
(vii) “Trading
Market” means the NYSE American, the Nasdaq Capital
Market, the Nasdaq Global Market, the Nasdaq Global Select Market
or the New York Stock Exchange (or any successors to any of the
foregoing).
(viii) “VWAP”
means, for any date, the price determined by the first of the
following clauses that applies: (a) if the Common Stock is
then listed or quoted on a Trading Market, the daily volume
weighted average price of the Common Stock for such date (or the
nearest preceding date) on the Trading Market on which the Common
Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02
p.m. (New York City time)), (b) if OTCQB or OTCQX is not
a Trading Market, the volume weighted average price of the Common
Stock for such date (or the nearest preceding date) on OTCQB or
OTCQX as applicable, (c) if the Common Stock is not then
listed or quoted for trading on OTCQB or OTCQX and if prices for
the Common Stock are then reported in the “Pink Open
Market” published by OTC Markets Group, Inc. (or a
similar organization or agency succeeding to its functions of
reporting prices), the most recent bid price per share of the
Common Stock so reported, or (d) in all other cases, the fair
market value of a share of Common Stock as determined by an
independent appraiser selected in good faith by the holders of a
majority in interest of the Warrants then outstanding and
reasonably acceptable to the Company, the fees and expenses of
which shall be paid by the Company.
[SIGNATURE
PAGE FOLLOWS]
|
|
||
|
|
|
|
|
|
By:
|
|
|
|
|
Name:
I. Xxxxxx Xxxxxxxxxx
|
|
|
|
Title:
Chief Executive Officer
|
|
|
|
|
|
|
[_________],
|
|
|
|
as
Warrant Agent
|
|
|
|
|
|
|
|
By:
|
|
|
|
|
Name:
|
|
|
|
Title:
|
|
Annex
A
|
Form of
Global Certificate
|
|
Annex
B
|
Form of
Certificated Warrant
|
|
Exhibit
A
|
Warrant
Certificate Request Notice
|
|
Exhibit
B
|
Assignment
Form
|
ANNEX A
[FORM OF GLOBAL CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION (“DTC”), TO ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
WARRANT
CERTIFICATE
NOT
EXERCISABLE AFTER _______, 2026
This
certifies that the person whose name and address appears below, or
registered assigns, is the registered owner of the number of
Warrants set forth below. Each Warrant entitles its registered
holder to purchase from Novusterra Inc., a company incorporated
under the laws of the State of Florida (the “Company”), at any time prior to
5:00 P.M. (New York City time) on _________, 2026, one share
of common stock, no par value per share, of the Company (each, a
“Warrant Share”
and collectively, the “Warrant Shares”), at an exercise
price of $___ per share, subject to possible adjustments as
provided in the Warrant Agreement (as defined below).
This
Warrant Certificate, with or without other Warrant Certificates,
upon surrender at the designated office of the Warrant Agent, may
be exchanged for another Warrant Certificate or Warrant
Certificates evidencing the same number of Warrants as the Warrant
Certificate or Warrant Certificates surrendered. A transfer of the
Warrants evidenced hereby may be registered upon surrender of this
Warrant Certificate at the designated office of the Warrant Agent
by the registered holder in person or by a duly authorized
attorney, properly endorsed or accompanied by proper instruments of
transfer, a signature guarantee, and such other and further
documentation as the Warrant Agent may reasonably request and duly
stamped as may be required by the laws of the State of New York and
of the United States of America.
The
terms and conditions of the Warrants and the rights and obligations
of the holder of this Warrant Certificate are set forth in the
Warrant Agent Agreement dated as of [______], 2021 (the
“Warrant
Agreement”) between the Company and [__________], as
Warrant Agent (the “Warrant
Agent”). A copy of the Warrant Agreement is available
for inspection during business hours at the office of the Warrant
Agent.
This
Warrant Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by an authorized
signatory of the Warrant Agent.
A-1
WITNESS
the facsimile signature of a proper officer of the
Company.
|
|
||
|
|
|
|
|
|
By:
|
|
|
|
|
Name:
I. Xxxxxx Xxxxxxxxxx
|
|
|
|
Title:
Chief Executive Officer
|
|
|
|
|
Dated:
[____], 2021
|
|
|
Countersigned:
|
|
|
[__________],
|
|
|
as
Warrant Agent
|
|
|
By:
|
|
|
|
Name:
|
|
|
|
Title:
|
|
|
A-2
PLEASE DETACH HERE
——————————————————————————————————————
Certificate
No.:_________ Number of Warrants:_ __
WARRANT
CUSIP NO.: ___________
|
|
|
|
[Name &
Address of Holder]
|
[__________],
Warrant Agent
|
|
|
By
Mail:
|
|
|
By hand
or overnight courier:
|
A-3
[FORM OF CERTIFICATED WARRANT]
B-1
